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2 Panama banks in proposed merger; Caixa to restructure client debts

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2 Panama banks in proposed merger; Caixa to restructure client debts

* Shareholders of Banco Panamá SA will vote May 30 on a proposed merger with Banco Aliado SA, El Capital Financiero reported. Banco Aliado, which is the fourth largest private-sector bank in Panama in terms of assets, will be the surviving entity under the proposal.

* Caixa Econômica Federal CEO Pedro Guimarães said the bank plans to launch a major debt-restructuring program for clients in which it will offer discounts of between 40% and 90%, Valor Econômico reported. The loans that will be renegotiated have already been accounted for as impairments, the executive said.

MEXICO AND CENTRAL AMERICA

* Eugenio Nájera, the CEO of Mexico's Nacional Financiera SNC Institución de Banca de Desarrollo and Banco Nacional de Comercio Exterior SNC Institución de Banca de Desarrollo, said no acts of corruption have been detected at either institution, El Financiero reported. Mexican President Andrés Manuel López Obrador earlier called for greater scrutiny of state-run development banks over concerns that certain subsidies granted by them led to corruption.

* Grupo Financiero Citibanamex SA de CV Director General Ernesto Torres Cantú said the use of cash in Mexico could be reduced by 90% in the next three years if the government prohibits cash payments for public services and certain goods, El Financiero reported. The use of cash in Mexico will decline once the new CoDi mobile payments platform becomes operational in September, he added.

BRAZIL

* Fitch Ratings affirmed Brazil's long-term foreign currency issuer default rating at BB-, with a stable outlook. The rating is supported by the country's economic diversity and entrenched civil institutions, but is constrained by structural weaknesses in public finances and high government indebtedness, among other factors.

* Brazilian state-owned banks are expected to repay this year at least 20 billion reais of the total 86 billion reais of support funds they received from the government during the term of former President Dilma Rousseff, Valor Econômico reported.

* Caixa Econômica Federal has requested proposals from investment banks interested in coordinating the planned IPO of its card subsidiary, three sources told Valor Econômico. The unit's IPO is expected to take place in the second half of 2019.

* Banco Santander (Brasil) SA CEO Sergio Rial said the bank is tightening its loan underwriting standards following a rapid acceleration in granting new loans, Valor Econômico reported. The bank will propose a lower borrowing limit for around 500,000 cardholders.

ANDEAN

* Peruvian financial regulator SBS is preparing a draft for a new general banking law, which it plans to send to Congress in about three years, Gestión reported. The new law will include a regulatory framework for digital banks, said Socorro Heysen, the head of the SBS.

* A Colombian bill that proposes to cut banking fees could reduce Grupo Aval Acciones y Valores SA's net income by 220 billion Colombian pesos if enacted in its current form, CEO Luis Sarmiento Gutiérrez said in an earnings conference call. "When faced with revenue-limiting restrictions, banks would have no option but to stop serving certain segments," the executive said. "This is exactly the opposite of what the bill intends to achieve."

* Itaú CorpBanca Colombia SA placed 350 billion Colombian pesos of bonds through a Dutch auction on May 21, Portafolio reported. The bank upsized the offering from 250 billion pesos after seeing high demand.

* The U.S. is readying criminal charges and sanctions against Venezuelan government officials thought to have used a military-administered food aid program to launder funds for President Nicolas Maduro's regime, Reuters reported, citing people familiar with the matter.

SOUTHERN CONE

* Argentine banks have adequate capital to absorb expected loan losses in 2019, according to Moody's. The rating agency sees credit cost rising and nonperforming loans hitting 4.5% this year, with all credit segments expected to underperform given higher interest rates and Argentina's deepening recession. Moody's expects Argentine banks to become more aggressive in corporate and consumer lending once market conditions improve.

* Argentina's government issued $900 million of U.S. dollar-denominated treasury notes on May 21, receiving a total of about $1.07 billion in purchase orders, Reuters reported, citing the economy ministry.

* Martín Lang, Mastercard Inc.'s country manager for Argentina and Uruguay, is retiring after 14 years with the company, El Cronista reported. He will be replaced by Agustín Beccar Varela, effective June 10.

* Paraguay's left-leaning Frente Guasú political alliance presented a congressional motion demanding that the country's central bank open a probe into Banco Basa SA, which has been linked to Brazil's massive "Lava Jato" corruption investigation, 5días reported. Banco Basa recently denied being under investigation in the probe.

PAN LATIN AMERICA

* The Organisation for Economic Cooperation and Development expects economic growth in five major Latin American countries to recover in 2020. It expects Argentina's GDP to contract 1.8% in 2019 before growing 2.1% in the following year. Brazil's economic growth is seen reaching 1.4% in 2019 and accelerating to 2.3% in 2020. Mexico's economy is forecasted to expand 1.6% and 2.0% in 2019 and 2020, respectively.

* BlackRock Inc. sees Brazilian and Argentine stocks and currencies trading at very cheap levels, which generates long-term opportunities as firms "will take advantage of the weak growth to right-size their operating structure," Bloomberg News reported, citing Ed Kuczma, a portfolio manager at the company.

IN OTHER PARTS OF THE WORLD

* Asia-Pacific: 4 Indian banks eye potential M&A deal; Chinese bank opens Prague branch

* Middle East & Africa: Nigeria raises insurers' capital requirements; DR Congo names new prime minister

* Europe: Norway takes Metro Bank stake; UBS nears Italy settlement; SIX Group fine upheld

Helen Popper contributed to this article.

The Daily Dose has an editorial deadline of 8:00 a.m. São Paulo time, and scans news sources published in English, Portuguese and Spanish. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.